The Conference Board of Canada

CONFERENCE BRIEFING
THE ECONOMIC BENEFITS OF IMPROVING LITERACY SKILLS IN THE WORKPLACE

BY MICHAEL R. BLOOM, MARIE BURROWS, BRENDA LAFLEUR AND ROBERT SQUIRES

There are clear economic benefits in improving workplace literacy, but the message has not yet reached many Canadian workplaces.
Benefits of literacy training cited by employers were the improved learning facility of the employees, their ability to work together as a team, and improved labour-management relations.
Employees with higher literacy skills earn more income, are less likely to be unemployed, have greater opportunities for job mobility, are more likely tofindfull- time work, and are more likely to receive further training.
A male with higher literacy skills makes an extra $585,000 over his lifetime. For females, the amount is $683,000.

Enhancing literacy levels in the workplace improves bottom- line performance for Canada's employers and gives employer's a better chance for success in their careers. The results of the Conference Board's study, The Economic Benefits of Improving Literacy Skills in the Workplace, demonstrate that there are clear economic benefits for both employers and employees in improving workplace literacy. The findings contained in this Conference Briefing and in the forthcoming research report, to be released in summer 1997, show that employers enhance the performance of their businesses in a wide variety of ways that strengthen the bottom line, and employees are better able to succeed in the workplace when their literacy skills improve.

These findings are significant for both business and individuals. In the past, choices about investing in literacy were often made without having the right information to make the best- informed decision. Today, however, there is growing recognition that literacy is such a critical factor in corporate and personal success that it demands greater consideration and understanding. Employers are beginning to pay more attention to the potential impact of literacy on their business success, and employees are asking themselves to what extent literacy skill levels affect their own personal success and economic wellbeing. This study clearly shows that they should be even more attentive to the literacy issue than they are today.

Literacy is important because it affects our human resource capability. A nation's human resource capability is the key to future competitiveness in an age when barriers to trade are disappearing, capital can be moved quickly, and natural resources are comparatively lowly valued. As a major trading nation, Canada's companies face significant competition in the marketplace. Globalization means that companies are increasingly faced with stiff international competition at home and abroad. Canada has traditionally enjoyed a comparative advantage in workforce skins over many of its competitors. However, recent rapid advances in the literacy skins of employees in other countries threaten our advantage; the competitiveness and profitability of our businesses are at risk. At the same time, the growing complexity of jobs in Canadian workplaces heightens the demands being placed on Canadian workers. For many, the literacy skins that earlier enabled them to do their jobs effectively are no longer sufficient for them to perform adequately today. Workers need to continuously acquire new skins and qualifications to succeed in modern workplaces.

Traditional Emphasis Is Shifting

Recognition by business and government of the crucial importance of developing human resources is relatively new.